SAA: R1.6 billion bail-outs but still R307 million spare for sports


A parliamentary reply from the Department of Public Enterprises (DPE) discloses that despite facing ongoing financial turmoil and requiring R1.6 billion in bailout funds last year, South African Airways (SAA) has handed out R307 million in sports related sponsorships and free travel for sporting celebrities since 2008.

“The total value of SAA’s sponsorships amounts to R268.3 million in cash and R38.7 million in free travel which is spread over four years from 2008 to 2012,” the DPE said.

Democratic Alliance Shadow Minister of Sport and Recreation Donald Lee – who asked the question – says this means one fifth of the amount designated to SAA in bailout funds last year has been spent on sporting sponsorships and free travel – which includes beneficiaries like Ángel Cabrera, an Argentine professional golfer who plays mainly in Europe.
“The department refused to disclose precisely how much any individual sponsorship amounted to, as they consider such information to be commercially sensitive information and confidential, however the mere fact that SAA has spent such a significant amount on sporting sponsorships, even while simultaneously requiring bailout funds, is difficult to comprehend,” Lee says.
“While the DA acknowledges the need to remain competitive in the global airlines industry, and that sponsorships can aid this, the sheer value of the sponsorships seems astonishing, and it seems highly doubtful that SAA is getting any bang for their buck. Faced with a choice of spending R307 million on freebies and sponsorships, and financial stability, we would prefer the latter from a state owned enterprise,” Lee adds in a statement.

The bailouts for SAA over the past five years have come either as cash injections or loans guaranteed by the state:
2004/05 – R6.1 billion
2005/06 – R2.4 billion (conversion of loans to equity)
2006/07 – R1.3 billion (loan guarantees)
2007/08 – R5.4 billion
2008/09 – R1.6 billion

Lee notes the Cabrera sponsorship was negotiated back in 2007, adding “we must remember that SAA received significant bailouts the same year.”

The DPE says recipients of SA largesse include:

The Sunshine Golf Tour

ATP Tennis

Cricket SA

SA Rugby

SA Football Association

ISM Golf Players
Ángel Cabrera